Large decline in state welfare enrollment perplexing

SEATTLE — With a massive budget shortfall looming, then-Gov. Chris Gregoire in August 2010 announced major changes to Washington state’s welfare program.

Fewer families would be eligible, with payments smaller and extensions harder to get. Combined with anti-fraud safeguards from lawmakers, the effort was designed to reduce the number of people getting welfare checks from the government.

It worked.

About 43,000 state families received welfare in October — nearly 30,000 fewer than when Gregoire’s changes took effect in early 2011, and the fewest since at least 1990, according to the Office of Financial Management.

State officials estimate the reduced caseload lowered the cost of welfare by more than $600 million between 2011 and 2015.

But it is unclear exactly why the caseload has dropped so far, so fast — especially as other signs of high poverty linger.

The numbers of state residents on food stamps and Medicaid have both edged upward since 2011, while student homelessness has soared. The percentage of residents living below the federal poverty line has remained steady, but homeless shelters report they have gotten busier.

Because the state does not track those who leave welfare, it is difficult to know if they have moved on to other taxpayer-funded programs. But social service advocates say the other programs’ growth at least proves that welfare’s declining caseload does not necessarily signal success.

“Were they successful at saving a bunch of money? Absolutely,” lobbyist Nick Federici said. “So maybe it’s a success for fiscal policy. It’s sure not a success for humanitarian policy.”

State House budget writer Ross Hunter said he hopes the Legislature will closely study what is driving welfare’s caseload reduction — Gregoire’s cuts, less fraud, an improving economy, fewer people choosing to apply or something else.

“We don’t really know,” said Hunter, D-Medina. “We have to look at it.”

Much smaller payments

Washington’s welfare caseload reduction echoes a nationwide trend set in motion by former President Clinton’s reform of the ambitious federal program.

Created in 1935 as Aid to Dependent Children and renamed Temporary Assistance for Needy Families in 1997, welfare is unusual in that it provides purely cash help.

It is the primary income source for participants and seen as one of three core supports for poor people, along with the larger Medicaid and food stamp programs.

Welfare’s money mostly comes from the federal government. But because it is distributed as a block grant, states can set their own policies and use savings for other programs.

In Washington state, the program pays up to $478 per month for a family of three.

That ranks 20th among states, according to the Center on Budget and Policy Priorities, a nonprofit institute. First is Alaska at $923; last is Mississippi at $170.

Washington’s current payment is significantly lower than in 1996. Back then, a family of three could get $546 a month — an inflation-adjusted 41 percent higher, according to the institute.

The mid-1990s were also when the program’s caseload peaked at more than 100,000 Washington families, according to the state.

Clinton’s aim, to “end welfare as we have come to know it,” added work requirements and established a five-year lifetime limit on receiving benefits.

But officials here initially chose to grant hardship extensions of the time limit to “just about anybody” who asked, said Babs Roberts, current director of the state division charged with running the program.

The caseload dipped, but not by as much as in other states.

And during the recession, it soared from 48,254 in October 2007 to a January 2011 high of 70,331.

Cutting the rolls

When Gregoire announced her cuts to welfare and many other areas of the budget, the state was facing a shortfall of hundreds of millions of dollars in tax collections.

“State government, out of necessity, will need to be smaller,” she said at the time.

Welfare’s eligibility level and monthly maximum payment were lowered by 15 percent, and time-limit extensions were allowed only for domestic-violence victims and those applying for Social Security disability benefits, among other moves.

In February 2011, the month the changes took effect, 4,571 families — or 15,298 residents — were kicked off the rolls due to the five-year limit, according to the state Department of Social and Health Services (DSHS).

Since then, about 160 per month have been removed for that reason.

Applications have also sharply fallen. About 16 percent fewer families applied for welfare in the first 11 months of 2013 as compared with January-November 2010, according to DSHS.

State Senate budget writer Andy Hill, R-Redmond, said that might be due to the Legislature’s 2011 efforts to tackle fraud and abuse.

That spring, lawmakers voted nearly unanimously to establish a welfare fraud and accountability office; to prohibit residents from using benefits at bars, clubs, casinos and tattoo parlors; and to permanently disqualify adults found to be out of compliance on work requirements multiple times, among other moves.

Hill heralded those changes and the “all-time low” welfare caseload in a recent email to reporters.

In an interview, he said “the attempt was to direct government money toward those people that really needed it, and that has happened.”

Another GOP member of the state Senate budget committee, Michael Baumgartner, said more welfare recipients are getting jobs.

“I think you’re seeing people who need a leg up get a leg up and then actively get involved in employment,” said Baumgartner, R-Spokane.

But DSHS numbers do not indicate a dramatic increase.

Of those leaving the welfare rolls, between 55 and 60 percent do so because of “self-sufficiency reasons,” usually finding work.

That hasn’t really changed in years, according to DSHS.

More homeless youth

Social service advocates say that in truth, those leaving the rolls are having more trouble than ever.

They argue that some are becoming homeless, pointing to increasing homelessness among students in Washington’s public schools.

In the 2009-10 school year, before the welfare cuts took effect, there were 21,826 homeless students, according to the Office of the Superintendent of Public Instruction. In the 2011-12 school year, there were 27,390.

Numbers for the 2012-13 school year are not yet available.

Alison Eisinger, director of the Seattle/King County Coalition on Homelessness, said shelters also appear to be busier, although it is difficult to know for sure.

“The legislators that put into place the policies that reduced the (welfare) caseload should be ashamed of themselves,” Eisinger said.

Other state numbers show that welfare’s reduction is not indicative of a massive turnaround for poor residents.

The percentage of residents living below the poverty line has leveled off after rising during the recession. The poverty rate was 13.4 percent in 2010, before the cuts, and 13.5 percent so far in 2013.

And more residents are using Medicaid and food stamps, the two other core supports for poor people.

About 1.24 million state residents got health coverage through Medicaid last June, before the program’s expansion, according to the state Health Care Authority. In June 2011, 1.22 million received Medicaid.

Food stamp usage, on the other hand, has been skyrocketing since before the recession.

The program’s eligibility expanded in 2008, and its caseload grew from about 310,000 state residents that year to around 500,000 in 2010.

But the growth has continued, from some 565,000 in 2011 to about 600,000 this year.

“I don’t think you have to be a rocket scientist to see the economy is still bad, the job market is still bad, and these people are still getting help from food stamps, from homeless shelters,” said Tony Lee, advocacy director for the nonprofit Solid Ground.

“That should tell you something about welfare.”

• Information from The Seattle Times archives is included in this report.

• Brian M. Rosenthal can be reached at 206-464-3195 or brosenthal@seattletimes.com.

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